South China Morning Post via Asia Media.
Thursday, February 9, 2006
By Simon Montlake
Bangkok --- The Thai press, backed by protesters, is accusing Singapore of acting unethically in its business dealings with Thai Prime Minister Thaksin Shinawatra.
Analysts warn that Singapore, whose investment arm Temasek Holdings led the $1.87 billion takeover of Mr Thaksin's family-owned Shin Corp, faces a nationalist backlash from the Thai public.
While much of the bile has been directed at Mr Thaksin, who is accused of bending tax rules to line his pocket, protesters are also taking aim at Temasek and its owner, the Singapore government.
Protesters who attended last weekend's rally in Bangkok said they objected to the sale of Shin Corp, the holding company for Thailand's biggest mobile phone company, a national broadcaster and a satellite company, to a foreign company.
Many also spoke out against continuing trade talks with the US and accused the government of selling out the country to Singapore and other foreign investors.
"Thaksin is selling our air. How can we breathe?" asked one protester. "If Thaksin really loves his country, he wouldn't do this."
Mr Thaksin has insisted the change of ownership does not end Thailand's control over telecommunications and satellite services, since Shin Corp only holds concessions from the government.
"What Temasek owns is only the right to operate those assets," he said in his weekly radio address on February 4.
But the sale to foreign owners of iTV, the broadcaster created in the early 1990s as Thailand's first independent channel with a mandate to provide in-depth news and current affairs, has raised hackles.
Questions are also being asked of Temasek's involvement in structuring the takeover, including the use of nominee companies in Thailand, so the Shinawatra family does not have to pay tax.
Some critics say Singapore is at fault for going along with the sale and may have failed to calculate the political risk of buying "tainted" assets.
Even if Singapore has broken no laws, it may have stumbled into a controversy that reflects poorly on its ethical leanings, they say.
Temasek is not a newcomer to Thailand. It already holds stakes in Thai banking, property and other industries.
Nor is it the first to take over a Thai telecom. Last year, Norway's Telenor bought out the majority Thai owner in Thailand's second-largest mobile phone company DTAC, in a deal that avoided any political backlash.
Critics argue that Temasek must be held to a higher benchmark, given the political nature of Shin Corp's rise and its ownership.
"You could say this is a normal business deal... but when it comes to companies owned by the prime minister, there are different standards," said Thitinan Pongsudhirak, a political scientist at Chulalongkorn University.
Date Posted: 2/9/2006